What is a Reaffirmation Agreement?

A reaffirmation agreement is basically an agreement between you and a particular creditor to continue paying on a debt that would otherwise have been discharged in your bankruptcy.

Reaffirmation agreements are most common when it comes to your vehicles and homes; however, you will also see them for other purchase money security type debts such as Nebraska Furniture Mart.

Additionally, we have clients who enter into reaffirmation agreements for debts that are not secured with many credit unions in order to maintain their “good standing” as a member with the credit union.

By law you do not have to sign a reaffirmation agreement. Some creditors will not move to repossess the property if you are current on the debt and continue to pay it on time. This is often referred to as “Ride and Pay;” however, this is rarely the case anymore.

Depending on the specifics regarding the debt, our firm will advise you as to whether voluntarily signing the reaffirmation agreement is in your best interests.

Once on file, you have 60 days from the date it was filed or prior to your Discharge, whichever occurs first, to cancel the agreement. Any cancellation of the reaffimation agreement must be done via the Court.

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